FIRST AMENDED AND RESTATED
SYSCO CORPORATION
2005 MANAGEMENT INCENTIVE PLAN
This
FIRST AMENDED AND RESTATED SYSCO CORPORATION 2005 MANAGEMENT
INCENTIVE PLAN (the “ Plan ”) effective as of
May 14, 2008, was recommended by the Compensation Committee
(the “ Committee ”) of the Board of Directors
(the “ Board of Directors ”) of Sysco
Corporation (the “ Company ”) on May 14,
2008, and adopted by the Board of Directors of the Company on
May 14, 2008.
WHEREAS,
the Company, with the approval of the shareholders, adopted that
certain Sysco Corporation 2005 Management Incentive Plan, effective
as of November 11, 2005, as amended by that certain First
Amendment of the 2005 Management Incentive Plan, dated
July 13, 2007, (the “ Current Plan ”);
and
WHEREAS,
pursuant to Section 11 of the Current Plan, the Board of
Directors has the authority, at any time, to amend the Current
Plan; and
WHEREAS,
the Board of Directors has determined that it is desirable and in
the best interest of the Company that certain amendments be made to
the Current Plan in order to remove the provision that requires an
additional common stock bonus equal to 28% of the cash bonus earned
by a participant pursuant to the terms of the Current Plan, and all
corresponding references to the additional stock bonus contained
within the Current Plan; and
NOW,
THEREFORE, effective as of the first day of the Company’s
2008 fiscal year, the Current Plan is hereby amended and restated
in its entirety, as follows:
1. Statement
of Principle
The purpose of the
Plan is to reward (i) certain key management personnel for
outstanding performance in the management of the divisions or
Operating Companies (as hereinafter defined) of the Company and
(ii) certain corporate personnel for managing the operations
of the Company as a whole and/or managing the operations of certain
Operating Companies (as hereinafter defined). For purposes of the
Plan, the term “Operating Company” means (a) any
corporation which is a member of a “controlled group of
corporations” which includes the Company, as defined in
Internal Revenue Code of 1986, as amended (the “ Code
”) Section 414(b), (b) any trade or business under
“common control” with the Company, as defined in Code
Section 414(c), (c) any organization which is a member of
an “affiliated service group” which includes the
Company, as defined in Code Section 414(m), (d) any other
entity required to be aggregated with the Company pursuant to Code
Section 414(o), and (e) any other organization or employment
location designated as a “Operating Company” by
resolution of the Board of Directors. All references to periods in
the Plan are to fiscal periods unless otherwise specifically
noted.
2. Plan
Compensation Committee
The Compensation
Committee (the “ Committee ”) of the Board of
Directors is charged with structuring, proposing the implementation
of, and implementing the terms and conditions of, the Plan. The
Committee shall have the authority to adopt, alter and repeal such
rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable; to interpret the terms and
provisions of the Plan and any award issued under the Plan (and any
agreements relating thereto) including without limitation the
manner of determining financial and accounting concepts discussed
in the Plan; to otherwise supervise the administration of the Plan;
and, except as to the application of the Plan to executive
officers, to delegate such authority provided to it hereunder as it
may deem necessary or appropriate to the Chairman of the Board,
Chief Executive Officer, President and any Executive Vice
President, and any of them individually. All decisions made by the
Committee pursuant to the provisions of the Plan shall be made in
the Committee’s sole discretion and shall be final and
binding on all persons, including the Company and Participants
(hereinafter defined).
The participants
in the Plan for a fiscal year shall be designated by the Committee
from the persons who are employed by any Operating Company or the
Company, in the following capacities (Operating Company
Participants, Corporate Participants, Designated Participants and
Senior Executive Participants are referred to collectively as
“ Participants ” or individually as a “
Participant ”):
Operating Company Participants — Persons who serve as
an officer of an Operating Company.
Corporate Participants — Persons who serve as an
officer of the Company who are also employees of the Company or an
Operating Company.
Designated Participants — Persons other than Corporate
Participants or Operating Company Participants who are employed by
an Operating Company or by the corporate office of the Company who
are designated by the Committee from time to time.
Senior Executive Participants — Persons who are
“covered employees” of the Company within the meaning
of Code Section 162(m) and Treasury Regulation 1.162-27(c)(2)
(or any successor statute or regulation section, or any
administrative interpretation thereof) (the “Executive
Compensation Provisions”) during a fiscal year of the Company
and who have been designated by the Committee as Corporate,
Operating Company or Designated Participants in the Plan for such
fiscal year. If a Participant is both a Senior Executive
Participant and a Corporate, Operating Company or Designated
Participant during a fiscal year as a result of the application of
the Executive Compensation Provisions, he or she shall be
considered a Senior Executive Participant, and not a
Corporate, Operating Company or Designated Participant, during such
fiscal year, and shall be subject to any and all restrictions
applicable to Senior Executive Participants hereunder during such
fiscal year.
To the extent
possible, the Committee shall designate Participants in the Plan
prior to the commencement of the fiscal year for which such
designated Participants will be entitled to a bonus under the Plan,
or as soon as practicable during the fiscal year in which a person
first becomes eligible to be a Participant. Subject to
Section 7 below with respect to a Change of Control, once
designated as a Participant, the Committee can remove an employee
as a Participant with or without cause at any time and the
Participant shall not be entitled to any bonus under the Plan for
the year in which he or she is removed regardless of when during
such year he or she is removed.
The bonus which a
Participant can earn is based (i) on the performance of the
Company as a whole and (ii) (A) (as to Operating Company
Participants and possibly Designated Participants and certain
Senior Executive Participants) either the performance of the
Operating Company which employs such Participant or the performance
of the Operating Company designated by the Committee as the
Operating Company by reference to which the bonus is to be
determined and (B) (as to Corporate and possibly Designated
Participants and certain Senior Executive Participants) the
performance of a select group of Operating Companies ((i) and (ii),
collectively or singly, “ Performance ”),
subject to the discretion of the Committee to formulate a different
bonus structure as to any Participant, other than Senior Executive
Participants. Subject to the provisions of Paragraph (ii) of
Section 4(D), the bonus is calculated with respect to an
entire fiscal year and, if earned, shall be paid in accordance with
Section 6 hereof.
(A)
Operating Company Participants and Certain Senior Executive
Participants.
With
respect to each Operating Company Participant and each Senior
Executive Participant who would be an Operating Company Participant
but for the application of the Executive Compensation Provisions, a
portion of the bonus may depend upon the return on capital and/or
increase in pretax earnings of the Operating Company employing such
Participant; a portion of the bonus may depend upon the return on
stockholder’s equity and increase in earnings per share of
the Company as a whole; and a portion of the bonus may depend upon
any one or more of the following performance factors:
(i) sales of the Company and/or one or more Operating
Companies, (ii) pretax earnings of the Company, (iii) net
earnings of the Company and/or one or more Operating Companies,
(iv) control of operating and/or nonoperating expenses of the
Company and/or one or more Operating Companies, (v) margins of
the Company and/or one or more Operating Companies,
(vi) market price of the Company’s securities,
(vii) market share, (viii) “economic value added,”
as determined pursuant to an objective formula approved by the
Committee (“ EVA ”), and (ix) with respect
to Participants other than Senior Executive Participants, other
factors directly tied to the performance of the Company and/or one
or more Operating Companies. The relative weights of the factors
considered and the percentages of the total bonus comprised by the
portion of the bonus determined with respect to the Operating
Company employing the Participant or the Operating Company
designated by the Committee as the Operating Company by reference
to which the Bonus is to be determined and the portion of the bonus
determined with respect to the Company shall be determined by the
Committee in its sole
discretion.
Notwithstanding the foregoing, the Committee may alter the bonus
formula with respect to any such Participant by changing the
performance targets as determined in the sole discretion of the
Committee; provided, however, the Committee cannot change the
performance targets after the first ninety (90) days of the
fiscal year with respect to Senior Executive
Participants.
In
addition to the bonus calculated in accordance with the first
paragraph of Section 4(A) above, an Operating Company
Participant may also be entitled to an additional bonus (“
Additional Bonus ”) if awarded by the Committee in its
sole discretion. The Additional Bonus may be established by the
Committee at one or more times during such fiscal year or within
ninety (90) days following the end of such fiscal year based
on such criteria as
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